A loyalty program is a marketing tool for creating repeat purchases and profitable cooperation for a brand and its customers. Benefits for a company are numerous: higher basket value, more referrals, uplift in purchases frequency and marketing costs saving to name just a few. On the other side of the loyalty equation, there are benefits the program brings to members. Only when both sides are balanced may a be successful.
The customer lifecycle or customer journey lets you identify and segment customers based on their position with your brand over time. When you can categorize customers, you can better understand how to assign your resources and how to create relevant messaging for your customers.
For a long time, loyalty programs have been considered for B2C initiatives rather than the B2B market. Because B2B businesses tend to have longer sales cycles and buyers that aren’t attracted by coupons, many thought that B2B loyalty programs would not be effective. These days, as competition has increased significantly, companies are realizing the value of investing in loyalty.
Segmentation is a business process in which marketers split a market of customers into relatively homogenous groups (called segments) based on specific parameters. There are plenty of approaches and possibilities for creating segments, but there are certain groupings that every segmentation strategy should include.
In theory, preparing simple promotion is not a complicated task. A loyalty program operator chooses promoted products and external partners, adjusts promotion mechanisms, and specifies the possible incentives. In practice, preparing promotions that achieve the set goals requires a bit more work.
A loyalty program allows brands to communicate with program members in many different ways. In addition to standards sales and information-related campaigns, there is another type of campaign that’s important for the program to run on a continuous basis, which includes program-related communication.
Every loyalty program requires ongoing care and improvements. What are the crucial elements of day-to-day maintenance of the program? Continuous evaluation and maintaining engagement of members. To help you keep up with this constant monitoring and development of your program, we have compiled a list of specific areas to keep an eye on.
Although acquiring new members and earning and burning points are the main goals of a loyalty program, there is one more thing to keep in mind: Key Performance Indicators (KPIs). They help you showcase how your loyalty program is working and if it is delivering a solid return on your marketing investment.
As the ways brands can connect with customers grow, so do customer expectations. It is no longer enough to offer customers a loyalty program that is based solely on transactional points. To gain consumers’ attention, brands must strive to understand their motivations and behaviors to deliver highly customized experiences that engage customers beyond the transaction.